Hindustan Motors has suspended the production of the iconic Ambassador, citing debt and lack of demand for the car. The country’s oldest car maker has shut down its Uttarpara manufacturing unit in West Bengal, where it has been making the iconic vehicle since 1957. However, this is basically a temporary shutdown and the company is trying to revive its iconic brand by adopting different measures.
The company has informed the Bombay Stock Exchange in a letter, citing “very low productivity, growing indiscipline, critical shortage of funds, lack of demand for its core product and large accumulation of liabilities”.
Based on the British Morris Oxford, the HM Ambassador was the first to be developed in the country and was preferred by the politicians and bureaucrats; however, it starts losing its shine once Maruti Suzuki introduced its 800 hatchback. With the introduction of global manufacturers, it further lost its market share.
This model is still the choice of a few politicians; however, it is still in use as a taxi in some Indian cities, especially in Kolkata. The company sold about 2,200 Ambassadors in the last fiscal years, which is a very less share of the 1.8 million passenger cars sold during the year in India.
“The suspension of work will enable the company in restricting mounting liabilities and restructure its organisation and finances and bring in a situation conducive to reopening of the plant,” the company said in its statement.
Despite its decreasing sales, this unique product with its cylindrical design and spacious interior has been admired by many. Moreover, this model was last year named the world’s best taxi by the BBC’s popular Top Gear television show.